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Senate Democrats Push for Tuition Tax Credit

Senate Democrats Push for Tuition Tax Credit

Focusing on a nearly five-fold increase in college tuitions, Senate Democrats called on Republican leaders last month to include a tuition tax credit in any budget package wrapping up this election-year session of Congress.
“We should not bankrupt families for doing what is right for their children,” says Sen. Charles Schumer, D-N.Y., who wants to give parents yearly deductions that he says would save as much as $2,800 per student on taxes.
According to the Democrats’ survey of 50 major private and public colleges, the typical tuition rose from $3,904 in 1980 to $17,772 in 2000.
Tuition and fees spiked in the early 1980s with double-digit annual rate increases, but such cost increases have leveled off in recent years, says Jeffrey Penn, an analyst with the College Board, which administers key college entrance exams and tracks college costs.
For example, tuition costs for both public and private schools rose less than 5 percent from 1998-1999 to 1999-2000, Penn says.
But lawmakers — saying tuition has outpaced the cost of health care and the rate of inflation — contend that current costs are shutting out students who otherwise would be trained to help the nation remain competitive in technology and other industries.
“Every time a young man or young woman does not go to college, not only do they lose, and their families lose, but America loses,” Schumer says.
Schumer says the proposed tuition credit — estimated to cost the federal government $29 billion over 10 years — is cheaper than other tax-cut plans pushed by the Republicans.
He says he is counting on momentum from a similar tuition tax-deduction plan being pushed by Vice President Al Gore on the presidential campaign trail. Gore has proposed expanding a current maximum $2,000 tuition-tax credit to a $2,800 maximum.
Republican Texas Gov. George W. Bush, who does not offer a tax credit, would allow parents to save money for college in special tax-favored accounts.
Congressional Republicans had no immediate response to the Democrats’ challenge, but with a full plate of spending bills and other plans, the tax-credit bill faces an uphill battle.  



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